Exotic flavours and region-specific confectionery products will boost growth, report

By Jane Byrne

- Last updated on GMT

Related tags Confectionery products Global confectionery market Confectionery

Exotic flavours and region-specific confectionery products will boost growth, report
The global market for confectionery products is forecast to reach US$186.3bn by the year 2015, driven by the growing popularity of sugar-free categories, exotic flavours and region-specific products, claims a new report from Global Industry Analysts (GIA).

Value-addition offers considerable opportunities, while premiumization emerges as the best revenue earning strategy, claim the authors of the research, Confectioneries: A Global Strategic Business Report​.

The industry specialists observe that the confectionery market started recovery only by mid 2010 and the impetus of growth was attributed to expansion in large regional markets of Western Europe, US and the emerging markets of China and Brazil.

“In many of the matured markets and in few developing countries, premium products came to the market’s rescue and revived the slack in pace. Despite decline in demand due to recession, sales of premium chocolates grew by 5 per cent during 2008, owing mainly to perceived health benefits,” ​notes the report.

But the analysts comment that the rising per capita consumption of chocolate globally coupled with growing interest towards healthy diets is representing ample opportunities for growth.

Investment in R&D boosted

The conclude that the global confectionery market is witnessing huge investments from producers towards product development and promotion.

"Heightening competition with high-value impulse items, hastening pace of lifestyle, maturity of major markets, growing health awareness and mushrooming product innovations and launches are driving up the costs of promotion and innovation in the industry,"​ claims the report authors.

They find that marketing of confectionery products is becoming more creative and focusing on the positive, health-giving aspects of consuming confectionery, rather than promoting the product as a mere indulgence. Confectioners, adds the publication, are also investing huge amounts in research and new product development.

Chocolate dominates

The analysts note that, in terms of products, chocolate confectionery constitutes the largest market, with bars, blocks and slabs and boxed or assorted chocolate still proving highly popular.

“In comparison to the rest of the confectionary groups, the chocolate confectionary market, specifically the boxed/assorted category fared relatively well during the recession period, showing only a mild decline.

The number of new chocolate products launched in 2009 was the same or even higher in comparison to 2008, in some countries such as Middle East, Asia, Africa and Latin America,”​ shows the GIA research.

Functional future

Fortified chocolate bars, they continue, are trying to grab their share in the nutrition and energy bars market. “Latest findings that brought to light the possible health benefits of consuming dark chocolates resulted in increased sales in the segment,”​ said the market analysts.

And, in the gum category, functional or fortified gums are fast replacing conventional breath freshening chewing gums, note the authors.

“While many producers continue to boast dental advantages of chewing gums, few others are trying to take advantage of the ability of the gum to offer full-body benefits - energy boosting gums for instance,”​ comments the report.

Gum growth

In fact, the analysts forecast that, in terms of overall growth potential however, the gums category is slated to grow at the fastest, with a predicted compounded annual rate of 4.2 per cent over the analysis period.

And rapidly emerging Asian countries with increasing disposable incomes and propensity to experiment with new flavours hold promise for future expansion, observed the researchers.

The US and Asia-Pacific markets trail behind Europe as the other two major confectionary markets worldwide.

“Asia-pacific is also forecast to expand at the overall fastest CAGR of 6.6 per cent through 2015,”​ predict the sector specialists.

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